Foster strong relationships with customer and extend your CLV.
We almost named this blog post Using CRM Analytics to Deliver the Goods & Services Your Customers Actually Want. This title sums up the goal and purpose of nearly every CRM program that exists today. CRM, or customer relationship management, is the cornerstone of customer-first business strategies and marketing initiatives. This customer-centric system allows companies to foster strong relationships with their customers by improving customer service through increased customer engagement. This allows companies to understand and meet the evolving needs of customers, drive customer satisfaction and loyalty, and ultimately extend the customer lifetime value (CLV).
Analytics plays an essential role in CRM Programs by connecting the dots between marketing initiatives, customer actions, and sales performance. Robust reporting and analytics enable organizations to glean key insights about marketing performance and turn them into actionable next steps.
Importance of CRM Analytics and the Intersectionality of Marketing Data, Sales Data, and Customer Data
Leveraging analytics tools in CRM practices allow for enhanced audience targeting efforts. It also creates opportunities for advanced customer segmentation and hyper personalization, while reducing cost and time spent through increased efficiency in marketing deployment and spend. The types of data utilized in CRM Analytics include marketing data, customer data, and performance data.
- Customer data extends far beyond demographics to include key information along the customer journey. Useful datapoints include:
- customer engagement
- page views
- clicks
- page views/visit
- average visits/order
- events pre-sale and post-sale
- future purchasing behavior.
- Marketing data includes the customers' measurable engagement with marketing campaigns. This includes specific channel data such as:
- open rates
- clicks
- click through rate (or CTR)
- first-touch channel
- last-touch channel
- visits and revisits.
Performance data includes your standard performance metrics such as revenue, orders, conversions, and even micro-conversions which are mini user actions that strongly demonstrate intent to progress towards profitable action on your website (i.e., adding a product to their basket suggests the intent to place an order).
The culmination of these main data types can not only strengthen the impact to customer sales, but can enhance business strategies across different books of business and lead to cost savings through operational efficiency.
Top 5 Benefits of CRM Analytics:
CRM Analytics plays a vital role in CRM and offers a multitude of optimization benefits. It provides invaluable insights that can either establish or enhance your customer loyalty program. Additionally, analytics helps in understanding and optimizing Customer Lifetime Value (CLV), enabling data-driven business decisions that contribute to heightened overall performance and increased customer satisfaction and retention. Here are our top 5 benefits of using analytics to inform your CRM practice:
- Understanding Your Customers Better - Starting with customers first, CRM analytics can help to better understand the needs of your customers and gauge whether your communication is effectively rendering your intended results. For example, email is an excellent marketing tool used to engage existing customers who are subscribed to your newsletter. CRM analytics can help you understand what type of emails and content your customers engage with most, from subject line, to preheader, to email format, to font, to imagery, to CTAs. Using marketing and customer data to gather these details can strategically guide your creative team to optimize emails to increase your open rate, click rate, CTR, thus driving revenue.
Metrics/Indicators: CTA clicks, CTR, engagement rate, conversions, page views
- Advanced Customer Segmentation - Customers are not one size fits all and neither are your marketing campaigns. Leveraging CRM analytics to create customer types/classifications can help your organization understand which customer is most profitable, most loyal, even most likely to go inactive (see next point), based on visit frequency, recency, basket size, orders/visit ratio etc. Using customer and sales data to gather these insights can help you create and better target these segments using the most effective approach.
Metrics/Indicators: basket size, AOV, Visits, Return visits, Customer Loyalty
- Improve Customer Retention - Customers come and go, but CRM analytics can greatly improve your customer retention by targeting customers who haven’t engaged with your organization in a while. Using customer, marketing and sales data to identify trends and patterns, you can identify customers who have the highest probability for churn (when customers stop using your products or services over a given period of time). To re-engage customers, your organization can use these insights to administer a customer satisfaction survey, or send personalized recommendations based on purchase history. Metrics/Indicators: LTV, Order recency/frequency, Purchase category
- Enhancing Campaign Efficiency - The key to successful marketing lies in its effectiveness. By leveraging marketing data, CRM analytics can empower your organization to gauge the impact of campaigns through tracking customer response rates, conversion rates, and ROI. This valuable understanding of what distinguishes a successful campaign from an unsuccessful one enables your organization to identify winning strategies, optimize marketing expenditure for future campaigns, and drive revenue while enhancing overall business performance.
- Cost Savings - When it comes to expenditures, CRM analytics offers numerous opportunities for saving costs through streamlined sales processes and optimized resource allocation, leading to reduced marketing spend. Understanding your customers’ behavior and understanding their purchasing patterns will allow you to anticipate sales seasonality. This understanding will allow you to market to your customers effectively, form accurate projections and make data-driven decisions on campaign initiatives that minimize expenses.
How To Get Started Getting Started/First Steps
Incorporating data analytics is an iterative process that demands consistent evaluation, driven by several factors like ongoing data collection, evolving business demands, fluctuating performance metrics, dynamic market conditions, and other pertinent considerations. Below is a high level outline on what to expect on your CRM analytics implementation journey
- Define KPIs and outline a strategic measurement plan
- Evaluate the current data quality for tracking accuracy
- Determine the appropriate analytics tool
- Define data governance policies and security protocols
- Create effective use-cases
- Create dashboards and reporting workspaces
- Provide training for stakeholders
For more information on how to start tracking analytics for CRM, Web or other tracking needs for your organization, complete this request form for a consultation.